Adjust for Inflation/Deflation
Many people don't realize that the cyclical bear market that began in 2007 is a continuation of the 2000 bear because in nominal terms the index peak in 2007 was a couple percentage points above the 2000 high. The next chart adjusts for inflation as measured by the Consumer Price Index. With this chart, it becomes clearer that the Tech Crash was the beginning of a secular bear market that is still ongoing. We also see that the low in 2009 actually took the market lower than the same point during the Great Depression.
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Nominal Total Returns
The next two charts offer comparisons of total returns with dividends reinvested. The first is based on nominal prices (no inflation adjustment). Again we see that the 2009 low was below the comparable period during the Depression era.
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